Sanofi and Evotec said today they have launched a research collaboration to develop new treatments for diabetes that will reduce or eliminate the need for insulin injections. The collaboration could generate up to €303 million (about $329 million)-plus for Evotec.

The collaboration will focus on developing a beta cell replacement therapy based on functional human beta cells derived from human stem cells. Additionally, the companies said, they will also use human beta cells in high-throughput drug screening, in order to identify beta cell active small molecules or biologics.

Sanofi agreed to pay Evotec €3 million ($3.3 million) upfront, and up to more than €300 million ($326 million) tied to achieving preclinical, clinical, regulatory, and commercial milestones. Sanofi also agreed to pay Evotec undisclosed “significant” royalties and research payments.

“Combining Sanofi's and Evotec's beta cell and stem cell expertise in drug discovery and development will enable optimal exploitation of the potential of stem cell derived human beta cells for therapy and drug screening in diabetes,” Philip Larsen, M.D., Ph.D., vp, global head of diabetes research and translational science at Sanofi, said in a statement.

Added Evotec CSO Cord Dohrmann, Ph.D.: “The use of human stem cells in drug discovery and development is on the rise and will increasingly shift the landscape from symptomatic treatments to disease-modifying therapies also in diabetes.”

By teaming up, Evotec looks to build its metabolic disease and stem cell-based drug discovery programs, while Sanofi aims to enhance and complement its diabetes portfolio. Evotec’s diabetes pipeline includes two preclinical molecules partnered with Harvard University and another two with AstraZeneca’s MedImmune subsidiary. MedImmune is one of two pharmas with which Evotec has had diabetes development partnerships until now; the other is Boehringer Ingelheim.

Sanofi’s longtime diabetes blockbuster, Lantus, lost U.S. patent protection exclusivity for its active ingredient in February—though the pharma giant launched a new formulation of the basal insulin, Toujeo, on March 30 in the U.S. Toujeo is one of six new drugs Sanofi expects to launch this year alone, and one of 18 new drugs set to be launched through the year 2020, generating a projected combined €30 billion ($33.9 billion) in new sales.

Short-term, diabetes sales are among Sanofi’s challenges. According to results released July 30, Sanofi’s diabetes net sales during the first half of 2015 fell 3.5% from a year earlier at constant exchange rates, to €3.825 billion ($4.154 billion). The slide was led by Lantus, which saw its January–June sales drop 5.4% to €3.293 billion ($3.576 billion). For Q2 itself, diabetes sales fell 3.8% to €1.988 billion ($2.159 billion), with Lantus down 5.8% to €1.709 billion ($1.856 billion).

Sanofi’s first launch of 2015 was Afrezza®, a rapid-acting inhaled insulin therapy that a diabetes treatment it brought to the U.S. market through a worldwide exclusive licensing agreement with developer MannKind. Afrezza generated €3 million (about $3.3 million) in net sales during the first half of this year, of which €2 million ($2.2 million) came during Q2.








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